challenge question was a, operation weeting, the code name for scotland yard's hacking investigation. scotland yard has a book called "the book," and operations are randomly assigned code names from the book. go to our website for more. thanks for being part of my program this week. i will see you next week. the headline-grabbing word scandal no longer captures what's happening to rupert murdoch's empire. targets as high as the prime minister and the queen and with one of his top lieutenants arrested in london today, this is a moment of reckoning for journalism. is there really any evidence of misconduct here in the u.s.? are murdoch's critics using this crisis as an excuse to vilify him. our guests include the editor of

"the guardian." how much is the press being spun by the president and the republicans. i'm howard kurtz. this is "reliable sources." the murdoch media empire is in all-out damage control mode as the scandal at the british papers continues to spread on this side of the atlantic, the fbi opened a preliminary investigation on whether phone hacking took place in the u.s. and the dizzies pace of developments has made headlines around the world. >> mps finally forced murdoch to withdraw his bskyb bid. his empire has cracked, but is it broken. >> following breaking news in london where the embattled chief executive of murdoch's newspaper has resigned. >> news international will issue a statement to say that rebekah

brooks has resigned as the chief executive of news international. >> more damaging details are emerging in the phone hacking scandal. other news corp properties are being implicated in the growing scandal. >> rebekah brooks resigned leaving the fight for news international's future to james and rub bert murdoch. >> rebeckah brooks was forced ot as the head of the newspapers, arrested to day by police in london in connection with the scandal. her predecessor less hinton who ran the dow jones resigned on friday. murdoch was forced to drop his $12 billion bid. the company took out full-page ads with a simple headline, we are sorry. in an interview with "the journal" murdoch says the company has made only minor mistakes in handling this debacle. joining us, from new york,

michael wolf, author of a biography of rupert murdoch. david faulk ken flick and here in washington sarah smith, washington correspondent for the uk's channel 4 news. sarah smith, rebecca brooks being arrested by the police, how much does this further the damage? >> on the face of it it looks very, very bad. it means we're probably one step closer to james murdoch being questioned and arrested over this which would damage the company and the family very, very much. there's probably something quite clever going on. she was arrested by appointment, if you've ever heard of such a thing, which is remarkable given the accusations that the police are too close to news international and due to give evidence to a parliamentary committee on tuesday. now she's been arrested. she may very well say she can't answer these questions because it will interfere with the police inquiry. >> i would not be surprised.

david, is there a sense that this is not just a "news of the world" problem anymore but a problem with the way murdoch's company does business? >> i think that's absolutely the case. you see this reach into the executive suites, not just the "news of the world." we've had the two previous editors, rebekah brooks and the former both arrested in this matter. i think it's worth pointing out this is a scandal that encompasses hacking into voice mail messages of royals, celebrities, politicians and victim of terror attacks. but also this is a police corruption scandal in which police appear to have been routinely paid for information that had been supposed to be secret and confidential. databases accessed, other matters like that. and senior officials question whether their relationships were too cozy. questions where they

soft-peddled investigations two years ago. it calls into question the proximity of the relationships between top executives, people like remembbecckah brooks, jame murdoch. >> it seemed murdoch was trying to protect rebekah brooks, resisting her resignation for more than a week. now is he down to protecting his son james and himself now that these other people have now quit or been taken into custody? >> of course he is. there's another interesting point to make here about the way that this -- about the entire company. there are really two companies. there's the perfectly reasonable, ordinary entertainment company which provides most of the revenue, most of the news corporation revenue. and then there is this newspaper company which is sort of a vestigal company, it exists

because rupert murdoch himself wants it to exist. that's really where the issue is, where the contagion is. it's within the newspaper -- it affects two things. it affects the newspaper, the newspaper company, and it affects people named murdoch who run the newspaper company. i think more and more we'll begin to see that split. in fact, there really is a simple solution for the company as a whole which is to get rid of the newspapers and the murdochs. >> rupert doesn't want to do that because he loves newspaper. democratic senator dick durbin on "meet the press" launched congressional hearings. there's no evidence at this point of any wrongdoing by any of the u.s. properties of news corp. but is this now turning into a two-front war for the company, on both sides of the atlantic? >> you can see they're absolutely terrified of having to fight this in the u.s. as well. the evidence is very thin to

nonexistent that there was any phone hacking done in america. certainly nobody has uncovered any evidence that 9/11 victims were hacked. jude law has brought a lawsuit against "the sun" alleging while he was at jfk airport he knew his voice mails were being listened to. that would be criminal activity in the u.s. if it happened. what the murdochs have to do is make sure it doesn't go nerney of their titles here, the "wall street journal" or "new york post" or any properties here. >> david, i wonder if you think the u.s. part of this is hype. we have a lot of members of congress and certain liberal media types jumping on saying we must investigate. but the locust of the story is very much in britain. >> there's no shortage of people in the american media establishment and the american political establishment who have taken issue with the fact that the properties, fox news and the "new york post" have done business. that said, we've got to be

careful. usually you don't want to get ahead of yourselves. in this one the story has each time surpassed your wildest expectations in the past two weeks. >> happened again this morning. >> absolutely right. i would say in terms of the american implications there's a question of whether british journalists for news corp broke the law here in 9/11. the evidence is scant. if the attorney general were to issue a wider ranging investigations, even actions that were illegal taken, for example, in great britain could reflect on the ability of news corp to hold on to american broadcasting licenses here. you could see repercussions under the question of the they interpreted as foreign officials being bribed as has been alleged with some substantive hearings. >> once you start an investigation, your don't know what kind of rocks are going to be turned over. >> michael wolff, let's talk about murdoch's role himself. the full-page ad with the

apology. went to the murdered girl's family whose phone had been hacked. doesn't seem like he's doing the full contrition route yet. >> one of the curious things about rupert murdoch is when he gives an interview, he only gives it to news outlets he owns. those are always very funny interviews. he's telling reporters what questions to ask and how to cast his response. >> how do you know he's telling his reporters what to ask. that's not entirely fair. the "wall street journal" is a good paper. >> i've sat with him when he's done this. i know who calls before. it is absolutely the murdoch playbook. you call ahead. you set it up. you tell them what questions to ask. in the middle of the interview he often does there. >> so what does all this get him? if he does an interview with an outlet that he controls? >> i don't know what it gets

him. it gets him further into a deerp hole. in that interview he sounds -- it sounds -- first thing, his answers are peculiar. his view of the world is peculiar. it is the murdoch -- what we see is the murdoch who believes he is in control. so he believes he's in control. yet to the rest of the world, what is obviously happening in we see him losing control in a way we see him out of control. >> sarah, he also said in that journal interview that news corp has handled this crisis extremely well in every way possible, just some minor mistakes. >> which is ludicrous because you just watched the way they've had to reverse themselves through the course of the week. first of all, they weren't going to appear in front of a committee of mps. then later they would. take these in british papers, ads saying "i'm sorry."

can you imagine when rupert murdoch has said i'm sorry. he. >> getting high-level pr advice. david, a short time before break. a national review online says you are treating this as the second coming of watergate and suggests geraldo rivera said you were a weak-kneed, backstabbing, sweaty palm report sgler my palms are relatively dry. people can decide for themselves. it's political, law enforcement, journalistic implicationless. it will determine the fate of this media company here in the united states. i plead guilty to thinking it's a real story. >> getting more incredible every day. on the other side we'll talk about the kind of journalist practiced by rupert murdoch's company in the states. even if there's no hacking

involved, it's something that we now should shine a little brighter spotlight on. stay with us. offers an epa estimated 42 miles per gallon on the highway. sglfrnlths iles per gallon. cool? ♪ is best absorbed in small continuous amounts. only one calcium supplement does that in one daily dose. new citracal slow release... continuously releases calcium plus d for the efficient absorption my body needs. citracal. ♪ [ doug ] i got to figure this out. ♪ [ dr. ling ] i want to spend more time with my patients.

[ jim ] i need to build a new app for the sales team in beijing. [ mrs. davis ] i need to make science as exciting as a video game. ♪ [ jim ] i need to push out a software upgrade. [ dr. ling ] review ms. cooper's history. [ doug ] i need to cut i.t. costs. [ mrs. davis ] i need to find a way to break through. [ jim ] i need to see my family while they're still awake. [ dr. ling ] see if the blood work is ready. [ doug ] i need to think about something else when i run. ♪ [ male announcer ] every day, we set out to do more than the day before. at dell, everything we do, from solutions to services, gives you the power to do just that. ♪ so i.t. professionals can be more productive... business leaders, more innovative... doctors can be more connected to patients... and teachers have the power to make a difference. dell. the power to do more. but i did. they said i couldn't fight above my weight class. but i did. they said i couldn't get elected to congress.

but i did. ♪ sometimes when we touch ha ha! millions of hits! [ male announcer ] flick, stack, and move between active apps seamlessly. only on the new hp touchpad with webos. with diabetes, it's tough to keep life balanced. i don't always have time to eat like i should. and the more i focus on everything else, the less time i have to take care of me. that's why i like glucerna shakes. they have slowly digestible carbs to help minimize blood sugar spikes, which can help lower a1c. glucerna products help me keep everything balanced. [ golf clubs clanking ] [ husband ] i'm good! well, almost everything. [ male announcer ] glucerna. delicious shakes and bars. helping people with diabetes find balance.

back talking about the murdoch media scandal and michael wolff. i talked to a couple of former reporters for the new york paste which had its own brush with scandal. they talked about thuggishness where reporters would play favorites and go after people that murdoch or the company don't like and had stories killed when someone went after people the company did like. >> i think it already has -- what we're really dealing with is a portrait of this -- an ethical portrait of this company. and i think the crucial thing is, and the thing that has happened to the company is that they've gotten behind -- the

temperament of the times has changed and they haven't realized this. i think we're going to look at -- the "new york post" is a good example. they probably haven't hacked phones themselves. actually their staff is too small. hacking requires too many resources. but nevertheless, the "new york post" is part of the murdoch method of reward and punishment. that's how he's built his power base. he likes you, he rewards you. he doesn't like you, he uses his newspapers to punish you. >> we do have to be careful about some of the allegations. a british blogger reported cnn's piers morgan may have known about illegal conduct that took place some years ago. he's he's the need knowing anything about that. >> that sounded like an official company denial. >> the official denial is all we have because piers morgan hasn't talked about it extensively.

i'd be happy to talk to him about it. >> david, people ask me about what about fox news and the "new york post"? i wonder if you think that's unfair at this point because the scandal is in london. >> the scandal is in london. one of the things to remember about murdoch is a lot of his dna, an australian anglo american institution, has come through the london newspapers that he oversaw to great success there. particularly you've got -- if you look at the fellow who is the editor in chief of the "news of the world," it was the guy who was the number two editor at the "new york post." they're closely linkedin dna which is not to say the allegations are the same -- >> i've got to cut you off. i want to get sarah smith in. this story will continue to get bigger before the crisis passes in your view? >> absolutely.

in britain certainly. people will look for tentacles of it here as britain will have to examine everything about the relationship with the press. were the politicians too close to the press? were the police too close to the press? >> very incestuous culture. the answer seem to be yes. thanks very much for joining us. coming up in the second part of "reliable sources" the newspaper who spent two years pursuing the hacking scandal is the guardian. we'll ask the editor about his paper's apology. then with murdoch on the defensive, are some of murdoch's critics using this crisis to pile on? are journalists getting the real school or just spin? candy? um-- well, you know, you're in luck. we're experts in this sort of thing, mortgage rigamarole,

whatnot. r-really? absolutely, and we guarantee results, you know, for a small fee, of course. such are the benefits of having a professional on your side. [whistles, chuckles] why don't we get a contract? who wants a contract? [honks horn] [circus music plays] here you go, pete. thanks, betty. we're out of toner. [circus music plays] sign it. come on. sign it. [honks horn] ...homes around the country. every single day, saving homes. we will talk it over... announcer: if you're facing foreclosure, make sure you're talking to the right people. speak with hud-approved housing counselors free of charge at...

two years ago the initial reports of a phone hacking scandal at "news of the world" had fade friday the headlines, the mess being blamed on a single rogue reporter. but "the guardian" stayed on the case, leading the the appalling revelation that is prompted rupert murdoch to shutter the tabloid. i spoke with alan rushbridger

from london. >> alan, welcome. >> happy to join you. >> you started digging into this story at "the guardian" two years ago. the police said there was nothing else to it. murdoch's people said there was nothing else to it. did you have any doubts that this wouldn't lead anywhere? >> there was a moment at round the end of 2009 when nobody was biting. the police had put the story to bed by coming out and denying it all. news international denied it. they said we were deliberating misleading the british public. the regulator, these quaint things called press regulators in britain. they said there was nothing in it. and no other papers were following it up. around about the end of 2009, early 2010, it was looking as though it was only us. but nick davis, our reporter, was very determined and i knew he was never going to give up. >> on that point, your deputy

editor, ian katz was quoted as saying that you were and the paper were slightly obsessive about this story. how do you plead? >> well, i think you have to be, especially a story in which you don't get a clean wind to begin with. i think the lesson of this story all around is if everybody came out and fade attention to the story we wrote two years ago in july 2009, "news of the world" would still be alive and i think rebekah brooks would still be in her job and we wouldn't have this giant crisis. >> why do you think, alan, with a few exceptions, almost nobody in the british media did aggressively follow up your story? were some of these organizations perhaps afraid their own techniques might be looked at? >> well, that's what people say. i don't know. again, there was a moment when just before the british election the -- there was an employment

tribunal which found that andy coulson presided over a culture of bullying at the "news of the world" and a former reporter was awarded a million dollars in damages. that's a staggering finding about a man who is just about to walk into number 10 downing street and not a single paper reported it. i just can't understand why there was an omerter at that point. >> it seemed so incestuous in terms of people from murdoch's company later being hired by others. andy coulson being hired as the top communications adviser to david cameron. you had a conversation with the incoming prime minister about that. can you recount that for us? >> well, we tried to warn all the party leaders of something that we couldn't write in february 2010. so this, again, you have to understand the british laws we have that you can't write about

people who are charged with things and waiting for the trial. we knew there was a private investigator, another private investigator who was charged with an ax murder, and he had -- he had been in prison earlier for planting cocaine, so on. he was a bad man and he had been hired by "news of the world" straight from prison in 2005. that was a story we couldn't write, but i thought the future prime minister should know that. i thought nick clegg and gordon brown should know that. i got a message to camera's office via my deputy to that effect. we know it got to his chief of staff. but his chief of staff didn't think that was worth passing on. >> did that put you in perhaps the uncomfortable position of offering advice to david cameron and other politicians about who they should or should not hire? >> it wasn't advice. he was free to do what he wanted. i went to see gordon brown and e-mailed nick clegg. i was doing it's cally with all

the parties. i just thought particularly as this was a story that was being ignored, i thought people ought to know there was going to be a story at some point that everybody would be writing. haven't we seen that this week? just because we couldn't write it and blow it open then didn't mean that there wasn't serious mud coming down the slipway. >> you caused a huge stir at "the guardian" when you reported roughly a week ago that former prime minister gordon brown, that his family medical records had been accessed by "the sun," another murdoch tabloid. that, of course, led to the story that the five-month-old baby hat cystic fibrosis. brown was outraged. on friday "the guardian" apologized and said you did not have evidence that the medical records were obtained by "the sun." that's a pretty bad mistake, isn't it? >> well, the difference is between the medical information

and the medical records. "the sun" says they didn't have access to the medical records. and gordon brown, his recollection as he told us, was that they did say they had the medical records. if "the sun" -- that's the difference. i don't think if you spoke to gordon brown tonight he wouldn't say he was happy about "the sun" ringing him up and saying they were going to publish information about his medical condition. i don't think it makes it much better for "the sun," we correct things when we get something wrong. >> there's a difference between making that kind of mistake which you did correct and all the allegations swirling around "news of the world"? you don't see them as anyway comparable? >> well, we haven't used illegal techniques. we haven't been going around on an industrial scale hacking into people's phones and we haven't denied for two years as news

international did that there was anything wrong. within two days "the sun" said that's not quite right and we corrected it. >> were there whispers or perhaps more than whispers during this time when you were out on a limb, somewhat lonely, continuing to write stories about this matter, the rest of the british media establishment not following you, that you were doing this for competitive reasons, that this was some kind of anti-murdoch campaign? >> of course people said that. they said we were a left wing title, we hated murdoch. we were doing it because we were in competition with "the times." they said all these things and my answer to that is, if you stopped trying to think about our motives and just read the stories, you would be in a better place today. >> alan rusbridger, thanks very much for joining us. >> happy to be with you. >> you can see the full version of that interview on our website. when we come back, is fox news

playing down the scandal that has rocked its parent company? but i did. they said i couldn't get elected to congress. but i did. ♪ sometimes when we touch ha ha! millions of hits! [ male announcer ] flick, stack, and move between active apps seamlessly. only on the new hp touchpad with webos. helps defends against occasional constipation, diarrhea, gas and bloating. with three strains of good bacteria to help balance your colon. you had me at "probiotic." [ female announcer ] phillips' colon health.

matter which position i am in i wake up feeling good. it fits you so perfectly... it fits you. you wake up and you're revived and rejuvenated. it's just like wow! tempur-pedic the most highly recommended bed in america. tempur-pedic is rated #1 in comfort. sleep satisfaction. and back support. it fits the curvature of your body but you don't sink in and it is firm. proprietary tempur material suppresses motion transfer.

this means that when you get in or out of bed, you won't disturb your partner. that's amazing. that's amazing. tempur-pedic, the most highly recommended bed in america. call the number on

knocks news loves a good scandal. when it involves the parent

company, not so much. they've tread lightly when it comings to the rupert murdoch story. from july 4th through july 13th, cnn ran 109 segments on the murdoch mess. msnbc ran 71, fox news just 30. cnn has even reported on fox's lack of reporting. >> the british media scandal involving rupert murdoch's news corps has put fox news in a bit of a bind. the network has apparently gone out of its way to avoid a lot of reporting on its parent company's troubles. >> not a word about this international story last week. on "news watch" panelists joked about off the air. >> anybody want to bring up the subject we're not talking about for the streamers? >> sure, go ahead. >> i'm not going to touch it. >> with a ten-foot turbine. >> the program did tackle the murdoch scandal yesterday. joining us to talk about how news organizations cover bad news about them sechls rnlgs james follows, national

correspondent for "the atlantic" and eric wellable who blogs about it. >> it's realistic to expect them to have some coverage. fox and friends had an expert on talking about how terrible it was to have all this hacking. citibank was hacked, the pentagon was hacked, the "news of the world" was hacked. why are we paying more attention to "news of the world" as the victim. >> the perpetrator would be the correct term. eric wemple. >> i think there's a difference between responsibility and expecting them to be on the forefront. one of the things i pointed out is if news corp doesn't cover this at all, it will hurt them in the ratings. i think that's a powerful check. if there's any company that cares about ratings, it's news corp. >> this happens to be a great and juicy story. >> if they totally ignore it,

they'll push people elsewhere. my only point is that you can cajole, shame, run numbers, but you can never expect the final word from the parent company. you have to have watchdogs deliver the final word. >> i think the "wall street journal" has done a good job, not a great job. is there suspicion if you cover it a lot that you're putting out a sanitized version? >> the clip i was mentioning on fox news did feed that suspicion. it's important to distinguish the "wall street journal" and fox news. they each are facing a kind of challenge. "wall street journal" is one of the great journalistic institutions in american history. even they have been light on the subject. there was a tough column in "the new york times" on this. in friday's front section of the "wall street journal" there was no news about this whatsoever. it was on the front page of other publications. fox is a different question, whether they're going to present

themselves as a real news organization at all if they so badly mishandle this story. >> i feel very strongly about this. when cnn has controversy, i always cover it. otherwise, what you're signaling to viewers is there's a double standard. we're only aggressive when some other organization is in trouble. i think that can undermine your credibility. you said it's unnatural and stupid to expect -- >> i think it's unnatural and stupid to say, gees, if you listen carefully to what wolf blitzer says, it seems as though fox news is going out of its way not to give a lot of coverage to its own parent company. duh. that does not deserve a breaking news logo. that's my only point. that's why we have what the british call media plurality. that's why we have other organizations that can burrow

in. if you, howard, cover the troubles of cnn, if you walk down the hall and figure something out, i wouldn't expect you to be the one to break it. >> one reason "the new york times" has special standing is after the jason blair scandal, after the iraq wmz scandal, they launched products. cbs with the dan rather situation had their own investigator come in. if the fox properties do something more like that, that's what we expect of news organizations. >> "new york times" didn't mention the blair story. i mention that because i did. fox news watch, after that embarrassment of not covering it at all, did talk about this yesterday. here are comments from columnist cal thomas. >> this is the biggest case of piling on since the last rugby game i saw. the left has been out to get news corp, especially fox news channel and the murdoch family

for years. >> isn't there something to that. the liberal critics of rupert murdoch are having a field day. cnn is covering it a lot. maybe cnn is covering it too much. >> there's no excessive coverage. the coverage i think is just about right. the reason why there might be that appearance is because you have two really far-flung time zones. you have rebekah brooks who resigns at our time 5:25 basically in the morning. les hinton resigns like 5:00 in the afternoon. >> ahead of dow jones. >> you have two resignations at the end of the day. what other perception can you have other than the media is playing it up? no. news corp is playing this up because everybody is going down. >> to emphasize why this matter, this is as big a crisis in britain in a generation plus. it's the police, political establishment, media

establishment and the most important media person in the u.s. which is rupert murdoch. not to cover this would be journalistic malfeasance. >> you have the democratic senatorial campaign putting out a statement. you wouldn't see that liberals who don't like rupert murdoch are just milking this for all it's worth? >> if this had no connection whatsoever to the nature of the operations, especially through fox news, you might say they're reaching. since the basic accusation that michael wolf was saying, that murdoch is using his media power for political ends is similar in the u.s. and the u.s. it's natural the democrats would say this. >> on your media blog at "the washington post" you took on a story about the difference between british and american journalism. you say basically we should come out and say british journalism standards are sleazy and destructive. you think we're dancing around this? >> in this particular iteration, i couldn't keep quiet.

i don't take relish in outing my own employer. i thought in this particular instance he said, none of this is to say american journalistic principles are spear yar to britain. nonsense. they are! the "new york post," pay for coverage, pay me, i'll keep you out of the paper. paper me, i'll put you in the paper. it goes both ways. muir dock now feels good about the clintons. let's write good things about the clintons. that's the point i was trying to make was that, yes, i do feel american standards are superior. >> which is not to say the american media are perfect. >> i think the range from high to low is broader than the u.s. it's no accident that most great american tabloid editors are brits. >> that's why they're bought over here. if you're just tuning in beb wreck ka brooks who resigned

friday arrested today. thanks very much for joining us. after the break, high stakes spin as president obama and congressional leaders race to avoid a government default. how do reporters find out what's going on behind closed doors? d from operating costs to innovation. so his company runs better, and so does doug. dell. the power to do more.

is best absorbed in small continuous amounts. only one calcium supplement does that in one daily dose. new citracal slow release... continuously releases calcium plus d for the efficient absorption my body needs. citracal. handle more than 165 billion letters and packages a year. that's about 34 million pounds of mail every day. ever wonder what this costs you as a taxpayer? millions? tens of millions? hundreds of millions? not a single cent. the united states postal service doesn't run on your tax dollars. it's funded solely by stamps and postage. brought to you by the men and women of the american postal worker's union.

[oinking] [hissing] [ding] announcer: cook foods to the right temperature using a food thermometer. 3,000 americans will die from food poisoning this year. check your steps at foodsafety.gov. personal pricing now on brakes. tell us what you want to pay. we do our best to make that work. deal! my money. my choice. my meineke.

weeks away from a possible government default. there is no bigger story in washington. in some ways, there's no story harder to cover with the negotiations behind closed doors. reporters are often reduced to relying on leaks such as this account of a testy account this week between the president and the house majority leader. >> the president again threatened to veto a short-term solution telling republican leaders don't call my bluff. >> all accounts, it seems like the president had a, well, hissy fit. >> mr. kantor had a tax tantrum and he's reduced to smearing and deriding the president's behavior and conduct. it's a cheap and disingenuous shot. >> how is the press covering the talks and the spin from both times? jonathan karl, from abc news and julie mason, white house correspondent for politico. jonathan karl, that began as a

leak. eric cantor later confirmed "don't call my bluff." how hardest to find out what's happening in the closed door talks? >> on the one hand you get leaks that are leaks to everybody. it's kind of interesting. some of the players in this, i won't tell you who, but some of the players in this actually send out e-mails to everybody. >> i'm not on that list. >> everybody is covering this thing with a blow-by-blow. some reads as it as a bad episode of "the west wing." the harder thing is to get ground truth and get beyond the span and try to assess what's actually happening. >> i'm going to come back to that. do you worry about being spun by one side or the other? >> you do. but you just make sure it's corroborated by somebody else in the room. >> if it was a republican leak where house speaker john boehner said "excuse us for trying to lead." i wonder who put that out?

>> exactly. you have to constantly assess who is speaking to you anonymously and what their motivations are and assume everyone is coming out with self-interest agendas and kind of a grain of truth. like john said, you have to corroborate it and figure out what's the closest version of reality. >> now we get to making it good tv. mitch mcconnell comes out with a plan to let president obama lift the debt ceiling as long as he proposes spending cuts which have to be approved or not approved by a supermajority in the congress, how do you translate this for viewers in a way they can understand? >> it's really difficult. the first thing to understand, it is probably the most important story we'll cover this year. so you start with that. and you try not to underestimate your viewers. they understand how high the stakes are, how important this stuff is. you try to present it in a clear and interesting way. it is a challenge, especially when you have a minute and 45 on television to tell what's going on. >> isn't this a perfect example of a story we're obsessed with,

but americans aren't paying attention yet. >> isn't that because despite moody's threatening to downgrade the debt, you have some republicans saying nothing really happens if we go past august 2nd and others saying there's going to be huge consequences to the u.s. economy. the players can't even agree on the stakes. how do u i don't cover that? >> that's true. you have to think americans have fiscal drama fatigue. it's one thing after another. they're like call me when there's a meltdown. >> we had that with the possible government shutdown in april which was resolved at the last minute. how about dealing with the delicate question of who is to blame? on the one hand you could argue that president obama, who wanted a big deal, boehner wanted a big deal, came up with at much as $3 trillion in spending cuts, several hundred billion in revenue increases to balance

that. you had the republicans led by eric cantor saying not one dollar in tax hikes. is it hard to assess whether you have one strong faction of the republican party holding up a deal? >> remember when the "the new york times" and "the washington post" that boehner and obama weren't working on a big, grand compromise. >> right. >> "the new york times" talked about the tax hike part of it. t"the washington post" talked about cuts to social security and medicare that obama was willing to go along with. the first stories were all about democrats screaming bloody murder about, you know, no way are they going to go along, congressional democrats, go along with cuts to meds care and social security even if the president wants it. then boehner walked out on the big deal and said no we're not going to do it. my point is there is clearly blame on both sides, and much of the focus right now has been the blame on the republican side. >> in a way that you think is unfair? >> at least not fully -- not really accurate.

because democrats in the house, i tell you, were not going to go along with any kind of a grand compromise that included real cuts to medicare and social security. >> let me make sure i understand you. on the one hand, you have the president of the united states saying i'm going to propose some things that i don't like that my side doesn't like because i think a grand deal is important here. i want some tax increases. he talks about the corporate jet owner and the hedge fund managers and millionaires and billionaires but i'm proposing serious cutbacks in meds care. i'm going to propose big spending cuts that my base won't like. but you're saying it's a mistake for reporters to focus too much on that because, just as boehner couldn't bring his house along, obama would have trouble bringing the democrats along. >> i'm saying right now the president saying that's a very big deal, something we've never heard from a democratic president. but democrats in congress were not going to go along with that. so it's one thing to be out there talking about it when you know it's not going to come up because republicans are blocking it, but democrats made it clear before boehner walked out on that big deal that they were not going to go along with that. >> eric cantor and other

republicans say they're standing on prince. that they ran on last year. they're being portrayed as intransigent. >> right. i think part of what we're seeing is is a maturation of the white house spin machine. they have gotten so much better at outplaying and outflanking the other side and not getting rolled and you're seeing it reflected in the coverage. they've gotten much better. >> barack obama likes reporters because he's had three news conferences in two weeks after months of nothing. >> i know. he wouldn't take questions. he was evasive, invisible. now he's all the time. kind of love it. >> one other question for the media, john, is who speaks for the republicans? we all know obama has that big megaphone, but is it eric cantor or john boehner, eric cantor or mitch mb connell with his own ideas for a short-term fix? >> right before one of these big white house meetings you had the ultimate absurdity, eric cantor holding a press conference off camera, pen and pad, and half an hour later john boehner holding a press conference, both by themselves, not with each other,

then immediately from there they wept to the white house. it's like exactly who is your voice of the republican party? it's very confusing. great for politico. >> right. god bless them. politico loves it so much. >> you don't want it to end. >> we want what's best for the nation, howie, but this is a good story. >> not necessarily what's best for politico. >> we are not at cross-purposes for america. we are not. >> i think we can agree with all this going on behind closed doors it's a very complicated but important negotiation going on. thanks for stopping by this morning. still to come, a white house aide calls a fox anchor a lunatic. an author catches the president stretching the truth about his mom. and why would the press identify the cia official who led the hunt for bin laden? [ man ] they said i couldn't win a fight. but i did. they said i couldn't fight above my weight class. but i did. they said i couldn't get elected to congress. but i did.

♪ sometimes when we touch ha ha! millions of hits! [ male announcer ] flick, stack, and move between active apps seamlessly. only on the new hp touchpad with webos. welcome. i understand you need a little help with your mortgage, want to avoid foreclosure. smart move. candy? um-- well, you know, you're in luck. we're experts in this sort of thing, mortgage rigamarole, whatnot. r-really? absolutely, and we guarantee results, you know, for a small fee, of course. such are the benefits of having a professional on your side. [whistles, chuckles] why don't we get a contract? who wants a contract? [honks horn] [circus music plays] here you go, pete. thanks, betty. we're out of toner. [circus music plays] sign it.

come on. sign it. [honks horn] ...homes around the country. every single day, saving homes. we will talk it over... announcer: if you're facing foreclosure, make sure you're talking to the right people. speak with hud-approved housing counselors free of charge at...

time now for the "media monitor," our weekly look at the hits and errors in the news business. author jannie scott and her book "a singular woman" discovered president obama was wrong when he said during the campaign his mother had a deathbed dispute with her insurance company over pre-existing condition.

in fact, this was a dispute about disabout and that her health insurer paid most of her bills without an argument. the white house does not dispute scott's digging. and the white house, its turns out, wasn't being entirely candid a couple years ago when it was openly at war with fox news. the treasury department had excluded fox from a series of meetings with top officials which the administration tried to blame on a snafu. but in e-mails obtained, one white house aide wrote, we prefer if you skip fox, please. after fox anchor bret baier had a dispute, the aides said he just did a stupid piece on it but he is a lunatic. now fox doesn't look so crazy for saying the channel was being treated unfairly. if there's one thing i hope we can agree on it's that the cia analyst who tracked down osama bin laden is a hero who helped bring a mass murderer to justice. i bet most americans would say

the media should protect his privacy so he isn't exposed to possible retaliation from islamic extremists. that's not what happened. the associated press reported earlier this month the analyst was just outside the frame of that famous photo of the president and his team honoring events in the situation room. the ap said call him john, his middle name, the story said. it described his work history and how he played on a division i basketball team in college. this week the new york observer advanced the story. the piece was cast as an examination of the ap report, the white house's use of digital media and the state of cyber sleuthing. the observer asked was it really up to a small weekly nupt to protect the life of a top terrorist hunter? it also mentioned which part of which state the analyst lives in and published his college yearbook photo. that's called having it both ways. touting a scoop under the guise of showing restraint. i think this was unfair to a man o